beware of dealing with the media

Posted on August 14, 2009 by Martin Malone

In L E Vantinnen-Newton -v- Geo Group UK Limited the Employment Appeal Tribunal, in overturning the decision of the tribunal, has yet again reminded employers that it is not enough simply to apply the rules when it comes to dismissal. Any decision to dismiss must be informed and, in misconduct cases, the employer must demonstrate the steps taken to establish the misconduct.

This may seem obvious but this case demonstrates why relying on procedures too heavily can cause an employer to take their eye off the ball. From the employee’s perspective it is a useful reminder that even the most innocent and apparently innocuous contact with the media can come at a high price in terms of sanctions in employment.

Revd. Vantinnen-Newton was head chaplain at the Campsfield House Immigration Detention Centre which was run by the Geo Group. He was dismissed for gross misconduct in November 2007 after giving a short interview to BBC Radio Oxford as part of a broadcast called “Faith in the workplace”. He did so without authority from the employer. The staff hanbook included the following instruction:

“Dealing with the media: No employee of Geo is authorised to make any comments or give any interviews to the media without prior and express permission of the managing director. Any employee who is approached by any media must refer the person to a senior manager at the earliest opportunity.”

Revd. Vantinnen-Newton gave the interview on 17 July. He informed his line manager on 19 July that he had given the interview, that it was due for broadcast on 22 July and that he should “look out for it”. As it happens the interview was not broadcast until 29 July. In the meantime no attempt was made by the employer to discover the content of the interview or even to contact the radio station. No-one in authority either heard the recording or read a transcript of it before Revd. Vantinnen-Newton was dismissed. However the employer did notify the UK Border Authority about the matter. In the words of His Honour Judge Reid QC in the EAT: “There is no evidence that anyone at the Home Office or the UK Border Authority displayed the slightest interest in the broadcast either before or after the event, still less that it had any repercussions for [Geo]“.

Revd. Vantinnen-Newton raised a grievance about his suspension, describing it was “unwarranted, hasty, demeaning, intimidating and vindictive”. Thereafter and as is so often the case with concurrent disciplinary and grievance procedures, the matter became bogged down with technical and procedural issues. The upshot was that Revd. Vantinnen-Newton did not attend the disciplinary hearing following which the decision was taken to dismiss him for gross misconduct. An appeal was unsuccessful.

In the tribunal it was held that the employer was entitled to take a “strict” view of the matter so that the action taken by the employer, although perhaps harsh, was within the range of reasonable responses available to a reasonable employer. The EAT disagreed. Although taking the view that the chaplain should have known that what he was doing was wrong in the context of the employer’s rules, the employer could not reasonably maintain that the interview was likely to bring the Company into disrepute if no representative of the employer (let alone those involved in taking the decision to dismiss) had even heard the interview. Accordingly Revd. Vantinnen-Newton was unfairly dismissed. However the tribunal had taken the view that if he was unfairly dismissed then he should be regarded as having contributed to his dismissal to the extent of 85% and the EAT agreed with this assessment.

One of the most frequently used authorities in unfair dismissal cases is British Home Stores Limited -v- Burchell and, although dating back to 1978 it was again of direct relevance in this case. It is worth mentioning the key guidance in that decision once again:

“What the tribunal have to decide every time is, broadly expressed, whether the employer who discharged the employee on the ground of the misconduct in question (usually, though not necessarily, dishonest conduct) entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time. That is really stating shortly and compendiously what is in fact more than one element. First of all, there must be established by the employer the fact of that belief; that the employer did believe it. Secondly, that the employer had in his mind reasonable grounds upon which to sustain that belief. And thirdly, we think, that the employer, at the stage at which he formed that belief on those grounds, at any rate at the final stage at which he formed that belief on those grounds, had carried out as much investigation into the matter as was reasonable in all the circumstances of the case. It is the employer who manages to discharge the onus of demonstrating those three matters, we think, who must not be examined further. It is not relevant, as we think, that the tribunal would itself have shared the view in those circumstances.”

construction workers and “false self-employment”

Posted on August 13, 2009 by Martin Malone

It is well-known that many workers in the construction industry are treated as self-employed for tax and employment law purposes whereas the reality is that they are employees.

“Employers” of these people are reluctant to pay Employers’ National Insurance Contributions and do not want to be burdened with the employment protection which is available to employeees.

In 2000 the Government introduced IR35 which was described at the time as a way for the Revenue to tax contractors “as though they are employees”. For those caught out the tax penalties were often very severe.

However, many people who are undoubtedly employees for both tax and employment law purposes are still being treated as self-employed contractors. It was therefore no great surprise that in this year’s budget the Government announced that it remained committed to the problem of “false self-employment in the construction industry” and proposed new legislation to tackle the problem head on.

The Government has recently issued a consultation document which is called “False Self-employment in Construction”. As a result, we can safely assume that the consultation is not about whether the problem exists. Rather, the Government is obviously fed up with the way in which people in this sector continue to classify themselves as self-employed when plainly they are not.

As a result the Government is going to turn the tables by starting from the premise that payments made are “deemed income” unless the paying and receiving parties can demomstrate otherwise.

The issue is significant from an employment law purpose because, although an individual can be an employee for employment law purposes and self-employed for tax purposes, if a person is classed as an employee for tax purposes this is a strong indicator that they will also be treated as an employee for employment law purposes.

The consultation closes on 12/10/09.

unfair dismissal – tribunals must not substitute their own views

Posted on August 4, 2009 by Martin Malone

Paul Wilson was a personal mortgage advisor employed by RBS. He was dismissed for gross misconduct after arranging a mortgage. A woman he knew came into the bank and said that she wanted to arrange a mortgage on behalf of her daughter and son-in-law. She supplied the relevant details including the property, details of the son-in-law’s earnings etc. and asked for a £98000 over 35 years. The bank charged an up-front fee of £499.

Somewhat surprisingly Mr Wilson processed the application on the basis of the information supplied and without even seeing the applicants. He also told the mortgage department that the applicants should not be charged the standard fee. However, in accordance with the normal practice, payment for the fee was taken from the applicants’ bank account. The applicants decided not to proceed with the application and complained when they discovered that the fee had been taken from their account without their consent. Mr Wilson was suspended, disciplined and dismissed for gross misconduct.

A tribunal took the view that Mr Wilson was dismissed for “doing his best” and that there was “embarrassment” for the bank because payment was taken from the bank account without a signed authority. If that was not remarkable enough, the tribunal took the view that the dismissal was so far outside the band of reasonable responses open to a reasonable employer that Mr Wilson could not be seen as having contributed by his actions to his dismissal!

It is no surprise at all that the bank appealed the decision and the EAT judgment was recently issued. It makes for entertaining reading, although presumably not for the employment judge concerned. The approach of His Honour Judge Richardson is apparent from an early stage. He notes that although the tribunal decision is divided into sections called ‘facts’ and ‘law and conclusions’ “they are, however, not as easy to summarise or analyse as might be expected”. He also notes that when quoting from the tribunal decision they have “corrected obvious errors of spelling and punctuation, of which there are a number”. Oh dear, you get the feeling that things are not going to improve from there for the employment judge!

The EAT noted that in its introduction to its decision, the tribunal noted that “in due course the Bank blamed the Claimant for everything” and that the mother of the prospective mortgagors was “clearly and obviously their agent”. Within its findings of fact the tribunal continued “What is more the embarrassment in this case arose for the Bank because they chose to take £499 on the basis of an electronic communication to them when the FSA Regulations say that the completed application should have a signature. It defeats the whole object of having a signature if the Bank acts without that signature on the belief that someone else has obtained it. The Bank has only itself to blame as far as we are concerned. We have little sympathy for them.”

The tribunal went on to quote section 98(4) of the Employment Rights Act 1996 (which concerns whether the employer acted reasonably or unreasonably in treating the reason as sufficient for the dismissal of the employee) and then stated “This we are satisfied is a case where there was a gross over-reaction to an error of a technical nature by an employee with no suggestion that…he had done anything other than use his commonsense and cut a bureaucratic corner”. It continued, “it beggars belief that a reasonable employer would not give its own employee the benefit of the doubt in the circumstances of this case where the mother has come in with all the relevant details and there is no risk at all of anyone being deprived of any money, unless of course, the Bank chooses to debit the client’s account before the full and necessary from is completed”.

On the question of the extent to which Mr Wilson might have contributed to his dismissal, the tribunal decided to offer him some advice:

“We think that with the benefit of hindsight the Claimant would be well advised in future always to make sure he has a signature before he puts in an electronic communication because otherwise those with a “tick box” mentality will come down on him like a ton of bricks and he might lose his job again…Is there any contribution in this case? No there is not. The dismissal is so far outside the band of responses open to a reasonable employer that we cannot for one moment think there is any contribution…”

OK, so this is an extreme case but it does provide a useful reminder that it is not the function of an employment tribunal to decide what they would have done faced with a certain set of facts. In this case we are left with absolutely no doubt what Employment Judge Ash would have done (however unlikely it is that the judge would have been in that position!) but that is not the point. We know from very many cases and appeal decisions that a tribunal is concerned to consider the objective standards of a hypothetical reasonable employer rather than the subjective views of tribunal members. The distinction is very important because this objectivity is at the heart of determining how the law relating to unfair dismissal should properly be applied. For example, in this case and adopting the words used in the tribunal decision, it is hardly likely that the employer would conclude “oh well, with the benefit of hindsight, we have only ourselves to blame”. Another example is the suggestion that Mr Wilson was dismissed for “doing his best”. As highlighted by the EAT he was not dismissed for doing his best; even on the basis of the tribunal’s own findings he was dismissed for doing something which he should not have done.

It would be foolish for employers to think that, because matters ought to be considered from an objective perspective, that will somehow let them off the hook for wrongdoing. However, it does help to dispel the view held by many employers that the tribunal will look at the matter from the employee’s perspective so that employment cases are stacked against them from the outset. RBS could certainly be forgiven for having that view after the tribunal hearing but in this case the appeal court has done its job by setting aside an obviously wrong decision and sending back the case to be heard by a different tribunal.